If you’re building a home, the time to insure it is before construction begins. Your home is at a different level of risk during construction and therefore requires different coverage before its completion. Although it may seem like an unnecessary financial burden to own two homeowners policies at the same time (one for the home you’re currently living in and one for the home you’re building), we assure you that the necessity is well founded.
One of the most common perils people face when building a home is theft of building supplies and construction materials. Some things won’t be covered by your policy until your new home is secure and able to be locked, so find out what those things are and act accordingly.
In some cases you may find that your policy on the home you’re currently living in may also provide coverage for theft at your soon-to-be home, so check that before purchasing extra theft coverage. For appliances and fixtures like sinks and ceiling fans, theft might be covered by your contractor’s insurance, so look into that as well.
Most standard policies will cover your soon-to-be home from fire, adverse weather, liability, theft and other perils, but don’t just sign a standard policy before looking at the fine print. And when it comes to liability don’t rely on your policy alone. Check that the construction workers and any other people building your home carry proper insurance coverage as well for their line of work. Verifying that the contractor and subcontractors have workers compensation insurance is important to protect you from being held liable in the case of an injured worker. Be sure to ask for proof of from your contractor and get a copy of his/her coverage certification. We advise calling the contractor’s insurance carrier to verify the information as well. This is certainly a case where you can’t be too careful!
If you yourself are a general contractor and are employing people to build your home with you then you’ll need to carry workers compensation insurance to protect the workers building your home with you.
For the do-it-yourself homeowner who calls on his/ her do-it-yourself family members and friends to help out, a standard homeowners policy will generally cover any injuries that may happen to family members and/or friends.
Once your home is built, re-evaluate your coverage and adjust your policy accordingly. Review and re-evaluate your policy annually to insure that your home is always up to date on the coverage it needs.